Surprisingly, BYD, a Chinese electric vehicle (EV) maker, has declared a major victory against Tesla, an American rival, by overtaking the latter in terms of sales of battery-only vehicles for the last quarter of 2023. During this time, BYD announced record-breaking sales of 526,000 battery-only vehicles, the first time its quarterly sales have exceeded Tesla’s.
Despite delivering an impressive 484,500 electric vehicles in the same quarter and a sizable 1.8 million for the full year, Tesla encountered difficulties as financing prices increased and demand declined. Although Tesla’s year-end performance beat analysts’ estimates and was hailed as a “clear win” by Dan Ives of Wedbush Securities, it did not meet Elon Musk’s lofty target of two million deliveries by 2023.
China’s Shenzhen-based BYD has shown resilient and nimble in the cutthroat electric vehicle market. Over 3 million new energy vehicles (NEVs), including hybrids and battery-only models, were sold by BYD in the full year. Nearly 1.6 million of these were battery-only cars, demonstrating BYD’s dominance in the EV market.
When it was first established in 1995, BYD was known for producing rechargeable batteries to rival more costly Japanese imports. In 2002, the corporation broadened its scope by venturing into the stock market and subsequently purchasing the faltering state-owned automobile maker Qinchuan Automobile corporation. The strategic decision made by BYD in 2008 to include Berkshire Hathaway, owned by Warren Buffett, as a shareholder has helped the company grow and maintain stability financially.
An essential component of EV production, BYD’s internal battery production is credited with its success. While many rivals rely on outside producers of batteries, BYD’s vertical integration offers flexibility and cost advantages. Due to this advantage, the company was able to aggressively reduce prices toward the end of 2023, which led to an incredible 70% increase in sales in December alone.
The victory of BYD highlights how fiercely competitive the EV market is and presents a challenge for Tesla to reclaim its top spot. The dynamic landscape highlights the importance of smart business decisions in the quickly changing electric car industry and suggests a shift in consumer preferences.